Arkansas’ September tax collections fall below forecasts
by October 2, 2014 3:32 pm 99 views
Overall Arkansas tax collections for the first quarter of the fiscal year were up only 0.8% compared to the same period in 2013 period, and are below budget forecasts by 0.5%, thanks to a reduction in consumer spending.
Year-to-date gross revenue (July 2014-September 2014) totaled $1.513 billion, up 12.4 million over the 2013 period but $8.1 million below what state budget forecasters predicted, according to the report issued Thursday (Oct. 2) by the Arkansas Department of Finance and Administration.
Individual income tax collections for the fiscal year totaled $713.7 million, up 3.2% from last year and just 0.7% above the budget forecast. Year-to-date sales and use tax collections were $557.4 million, down 1.7% compared to last year and 2.3% below the budget forecast. Income taxes and the sales and use tax collections are the two primary sources of state revenue.
John Shelnutt, head of the Department of Finance and Administration’s Economic (DFA) Analysis & Tax Research division, said the biggest reason for the overall decline was a drop in sales tax collections.
“September results were below forecast in all major categories of collections. Sales tax collections accounted for $8.1 million of the decline for the month against forecast. Individual Income tax collections were down 1.5 percent from year ago results and below forecast by $4.1 million, largely due to payroll timing effects in the Withholding category,” Shelnutt explained in the report.
Sales tax collections are a reflection of consumer spending and consumer confidence.
Corporate income tax collections for the first two reporting months of the fiscal year totaled $103.2 million, down 4.5% compared to last year and 8.4% below forecast.
SEPTEMBER NUMBERS
September gross revenue was $585.4 million, down 0.8% from last year and 2% below forecast.
Individual income tax collections during September totaled $183.7 million, down 1.7% compared to September 2013 and below forecast by 1.4%.
Sales and use tax collections during the month totaled $188.2 million, down 3.3% from last year and 4.2% below the forecast.
Corporate income tax collections in September totaled $77 million, up $1.7 million compared to September 2013, but 1.4% below forecast.
OTHER TAX COLLECTIONS
Alcoholic beverage
July 2014 – Sept. 2014: $14 million
July 2013 – Sept. 2013: $13.3 million
Games of skill
July 2014 – Sept. 2014: $10.5 million
July 2013 – Sept. 2013: $9.6 million
Tobacco
July 2014 – Sept. 2014: $56.3 million
July 2013 – Sept. 2013: $56.9 million
Insurance
July 2014 – Sept. 2014: $22.1 million
July 2013 – Sept. 2013: $21.5 million
COLLECTIONS HISTORY
Tax collections during fiscal year 2014 (July 2013-June 2014) totaled $6.242 billion, up 0.5% above the previous fiscal year and up just 0.2% compared to budget estimates. The year marked the fourth consecutive year of revenue increases. The fiscal year ended with a budget surplus of $78.7 million.
Tax collections during fiscal year 2013 (September 2012-September 2013) totaled $6.214 billion, up 4.9% above the previous fiscal year and up 2.5% compared to budget estimates. One result of the gains was a budget surplus of $299.5 million.
Arkansas tax collections reversed a negative two-year slide in the 2011 fiscal year, with collections up 4.5% in the September 2010-September 2011 period. State tax collections for fiscal year 2011 totaled $5.673 billion, up 4.5% above the $5.43 billion in the 2010 period.
The biggest declines in the 2009 and 2010 fiscal years were with individual income tax collections and sales and use tax collections.